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RBA governor, Michele Bullock, is offering a few more clues on where the central bank’s thinking is heading today. And the message is becoming increasingly difficult to read as anything other than higher-for-longer. Here are her added comments to the earlier message:

• Inflation risks are now materialising from both the Middle East and excess demand at home
• Neutral rates are rising globally, helping to push real bond yields higher
• Australian dollar performance is broadly reflecting commodity prices and interest-rate differentials

Her point on inflation risks is one to be wary about. The RBA can arguably look through some of the direct impact from an external energy shock. However, it becomes much harder to do that when domestic demand is…

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• RBA's…

The screenshot is of the Kiwi, getting a push higher from Reserve Bank of New Zealand Governor Breman earlier:

• RBNZ's Breman says higher oil prices point to firmer near-term inflation

Back to Bullock ...

The two comments released so far are limited in scope, but they reinforce rather than shift the hawkish framing Bullock struck before parliament last Friday, when she pointed to materialising upside inflation risks and flagged a general view that the neutral rate has risen. Her comment that supply shocks are difficult for monetary policy to manage restates a familiar central banking constraint, but pairing it with a focus on second round effects, the way an initial price shock feeds into broader wage and price setting behaviour, signals…

With both sides signalling modest ambitions, markets are unlikely to see a major trade breakthrough from this week's meeting, reducing the odds of a sharp risk on move tied to US-China relations specifically. The expected extension of the Busan trade truce, due to expire in November, removes a near term tail risk of renewed triple digit tariffs and disrupted rare earths access, both of which weighed heavily on bilateral trade last year. Any progress on the Board of Trade's proposed tariff carve outs for up to $30 billion in Chinese exports, spanning US agriculture, energy and medical products alongside Chinese consumer and low tech goods, would be incremental rather than transformative, but could offer modest relief to affected sectors.…

The move tightens sanctions pressure on Iran's aviation sector at a time when the broader Iran conflict has already driven sustained volatility in oil markets, and it reinforces the Trump administration's wider economic squeeze on Tehran rather than introducing a new standalone shock. For oil specifically, the airline measures are unlikely to have a direct supply impact, but they signal continued escalation in the sanctions regime, which traders may read as reducing the likelihood of near term de-escalation and a fading war premium. The China angle is arguably more market relevant: Bessent's description of Chinese officials as "very engaged" on compliance, ahead of Thursday's Trump-Xi summit, could be read either as a genuine diplomatic…

Breman's comments point to a central bank monitoring a genuine upside inflation risk from oil without yet committing to a specific policy response ahead of October, keeping optionality intact rather than pre-signalling a move. For the New Zealand dollar, an acknowledgment that inflation could run somewhat hotter than the September Monetary Policy Statement assumed is a mildly hawkish data point, though it is balanced by Breman's parallel emphasis on an uneven and still-recovering economy, which cuts against reading this as a clear signal of imminent tightening. Markets had already been pricing a pause at the October meeting following September's hike to 2.75%, and nothing in these remarks appears to shift that base case, though the…

Multiple independent sentiment gauges climbing together strengthens the read that this is a genuine market wide mood shift rather than an artefact of one provider's methodology, and it lines up with the altcoin rally and elevated whale activity already visible in on-chain data this week. Extreme greed readings are typically treated by market participants as a caution flag rather than a signal, since euphoric sentiment has historically preceded pullbacks, though the relationship is a loose historical pattern rather than a reliable predictor. The spread between providers is itself informative: a market where every gauge agrees closely tends to reflect broad, low ambiguity sentiment, while a widening spread between trackers can signal that…

The PBOC allows the yuan to fluctuate within a +/- 2% range, around this reference rate. More here on this.

• strongest for CNY since 3 February, 2023
• PBoC injects 35bn yuan via 7-day reverse repos at 1.40%

This article was written by Eamonn Sheridan at investinglive.com.

Musalem's comments reinforce a hawkish tone from within the Fed just days after this month's rate rise, and his preference for acting sooner rather than later aligns with market pricing that already points to further tightening ahead, with investors currently expecting three more quarter point hikes across the next five meetings through April and roughly even odds of an October move. His framing of the current 3.75-4.00% policy rate as still "on the accommodative side" suggests he sees meaningful room for further increases before policy becomes restrictive. For commodities specifically, his explicit inclusion of base metals such as copper alongside oil broadens the inflation narrative beyond the Middle East driven energy shock that has…

The rules add a fresh layer of regulatory cost and complexity for data centre developers operating in Victoria, potentially slowing approvals or raising build costs for companies required to source dedicated renewable energy and non-drinking water supplies. Because the changes are not retrospective, already approved projects and applications currently before the minister are shielded from the new requirements, limiting near term disruption to committed pipelines.

For companies like Amazon and Microsoft with a stated interest in Victorian data centre investment, the new guardrails introduce planning risk that could influence where future capacity is sited relative to other states or jurisdictions with lighter requirements. The sector's…

The fixing mechanism matters most right now because of what it has been signalling over recent weeks. The PBOC set its reference rate at the widest weak side deviation from market estimates in six months in late August, after the yuan touched a three and a half year high, a clear sign of discomfort with the pace of gains rather than the level itself. Traders should read this as the central bank applying the brakes rather than attempting to reverse the broader trend, since the yuan has still risen a meaningful amount against the dollar this year. The balancing act Beijing faces is straightforward: a stronger currency helps with capital stability and import costs, but too rapid a rise risks eroding export competitiveness at a time when the…

Deutsche Bank's argument, if it plays out, points to further upside risk in bond yields and continued pressure on rate sensitive assets, since current pricing implies only two more Fed hikes by July 2027 despite what the bank frames as intensifying inflationary pressure.

Equities are not necessarily the casualty in this scenario. Allen's own comparison to 1999, when the Fed hiked, yields rose and the S&P 500 still gained close to 20%, suggests strong growth and hiking cycles can coexist for a period. The bigger risk in Allen's framing is timing: he argues something has to give between currently resilient risk assets and a tightening path that ends up going further than markets expect, which would matter most for credit spreads and equity…